fast facts: hr metrics · human resources metrics are measurements used to determine the value and...
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HR MetricsFAST FACTS:
Solid HR metrics are the keys to measuring performance. Use this guide to learn what information to collect and how to use that information to determine what is working, what isn't, and how you can fix it.
human resources metrics
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METRIC FORMULA
Absence rate# days absent in month ÷ (average # of employees during a month x # of workdays)
Benefit or program costs per employee total cost of employee benefit/program ÷ total # of employees
Benefits as a percent of salary annual benefits cost ÷ annual salary
Compensation as a percent of total compensation
annual salary ÷ total compensation (salary + benefits + additional compensation)
Compensation or benefit revenue ratio compensation or benefit cost ÷ revenue
Cost per hire recruitment costs ÷ (compensation cost + benefits cost)
Percent of performance goals met or exceeded
# of performance goals met or exceeded ÷ total # of performance goals
Human Resources Metrics are measurements used to determine the value and effectiveness of HR strategies. These typically include such items as cost per hire, turnover rates/costs, training and human capital return on investment (ROI), labor/productivity rates and costs, benefit costs per employee, and others. HR metrics are a vital way to quantify the cost and the impact of employee programs and HR processes and measure the success (or failure) of HR initiatives. They enable a company to track year-to year-trends and changes in these critical variables. It is how organizations measure the value of the time and money spent on HR activities in their organization.
For Human Resources Metrics to be effective, though, they must be the right metrics and aligned with business objectives. Typically, companies will choose 4 - 6 HR Metrics that closely measure HR effectiveness and are important to their specific organization. Below are examples of the most common HR Metric formulas that are widely used across industries.
Page 2© Integrity HR, Inc. All Rights Reserved. | www.integrityhr.com | 502.753.0970
METRIC FORMULA
Percent receiving performance rating# of employees rated under a given score or rating on their performance evaluation ÷ total # of employees
Revenue per employee revenue ÷ total # of employees
Return on investment (ROI) (total benefit – total costs) x 100
Time to fill (average) total days taken to fill a job ÷ number hired
Training/development hours sum of total training hours ÷ total # of employees
Tenure Average # of years of service at the organization across all employees
Turnover (annual)# of employees exiting the job during 12 month period ÷ average actual # of employees during the same period
Turnover costs total costs of separation + vacancy + replacement + training
Utilization percenttotal number of employees utilizing a program/service/benefit ÷ total number of employees eligible to utilize a program/service/benefit
Workers’ compensation cost per employee
total workers compensation cost for year ÷ average number of employees
Workers’ compensation incident rate
(number of injuries and/or illnesses per 100 full-time employees∕total hours worked by all employees during the calendar year) x 200,000
Yield ratiopercentage of applicants from a recruitment source that make it to the next stage of the selection process